Body criticised by Darling should check SNP figures say Scottish Labour

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  By Martin Kelly
 
Scottish Labour has called on the SNP to submit its pension and welfare plans for scrutiny to a London based body whose credibility has been called into question by Labour MP Alistair Darling.
 
Labour MP Cathie Jamieson has said First Minister Alex Salmond should “put his money where his mouth is” by submitting his party’s welfare and pension proposals to the Office of Budget Responsibility (OBR).

The MP, who is also Scottish Labour’s Treasury spokeswoman, said: “If Alex Salmond really believes he has nothing to be afraid of, and that his plans for higher spending on pensions and welfare are compatible with lower taxes for big business, then he should let the OBR take a look at his figures and independently audit them.”

However the calls have been dismissed by the Scottish Government who have pointed out that former Labour Chancellor Alistair Darling has already denounced the OBR, claiming it has been “politicised”.

A spokesman for the First Minister said: “In the first instance, the OBR has no remit.  Secondly, the Scottish Government’s Fiscal Commission, including two Nobel laureates, is already working to shape the development of a robust fiscal and macroeconomic framework for an independent Scotland.

“Thirdly, and problematically for Cathy Jamieson, the OBR has been dismissed as being politically partial by Alistair Darling.”

Speaking to the Financial Times in 2010 Mr Darling, who heads the anti-independence alliance Better Together, claimed the OBR had been politicised.

“Right from the start the Tories used the OBR not just as part of the government but as part of the Conservative Party.  They have succeeded in strangling what could have been a good idea at its birth.” he said.

The OBR didn’t exist prior to the 2010 UK General Election.  Established by UK Chancellor George Osborne in 2010, the Office for Budget Responsibility was supposed to provide independent and authoritative analysis of the UK’s public finances.

However its track record has proved less than successful, with a string of inaccurate forecasts that have had to be revised.

In December 2011, just months after being formed, the body was forced to revise UK growth figures from an initial projection of 2.5% growth for 2012, down to just 0.7%.

Appearing before a Commons Treasury Select Committee, the OBR chief Robert Chote was accused of using “guesswork” after a series of revisions for years up to 2016 led to the ‘disappearance’ of £65 billion from the UK economy.

Joining Labour colleague in questioning the credibility of the OBR was Pat McFadden, a former Labour cabinet minister.

Talking to OBR chiefs, he said: “These are drastic changes, these are not minimal changes.  If you got it so wrong a matter of months why should anyone believe what you have got to say this time or the next time?”

The OBR has also come in for criticism for publishing pessimistic oil revenue forecasts which are at odds with industry estimates and those of other respected bodies.

According to the OBR, oil and gas revenue is volatile and likely to drop immediately after 2014 – coincidentally straight after the independence referendum.  Unionist parties and other groups, such as the Glasgow based Centre for Public Policy Research base their own forecasts on the OBR figures.

Earlier this year, respected oil economist Professor Alex Kemp described the OBR’s oil forecasts as “contrary to the evidence from the industry.”

The OBR’s head Robert Chote was interviewed by Andrew Neil on the Sunday Politics Show on March 24th.

Read more about the OBR by clicking HERE